When you take out a mortgage loan in Australia there are some terms, jargon and lingo you might want to familiarize yourself with so you know what your real estate agent, mortgage broker and lender are talking about when they deal with you.  Here is a brief guide to some of the terminology used in the Australian home loan business.

Accrued Interest – This refers to home loan interest that has been calculated but not yet added to your debt to be paid.

Adjustable Rate Mortgage (ARM) – An adjustable rate mortgage loan is simply another name for the variable rate mortgage.  This type of Australian mortgage has an interest rates that are adjusted periodically according to a financial index. The amount of your monthly payment fluctuates up and down according to these rebates.

Arrears – This describes an amount that is overdue to be paid out on a loan.

Assets - This refers to the property that is owned by the borrower.

Closing Costs – These are fees that are performed in the name of closing a loan application. These costs include recording fees, credit report fees, application fees, title fees, surveying fees and taxes.

Credit Reference Association of Australia – This is the organization where lenders can obtain credit information on applicants.

Equity – The amount of an asset, which is actually owned by the borrower. It is an amount that can be borrowed against.

Guarantee – This is a form of security in which another party who cosigns the Australian mortgage agreements promises to repay a loan if the borrows fails to repay it.

Home Appraisal – This is a written analysis of the estimated value of your home.

Liabilities –This is a term that refers to a person’s debts.

Lien – This describes a right  (either yours or the bank’s) to hold property

Line of Credit – This is a loan with a specified limit, somewhat like a credit card.

Loan Maintenance Fee – This is a loan management fee charged over the life of a loan.